$139 million: Cost of charter expansion so far

Charter school expansions approved by the School Reform Commission this spring are projected to cost the cash-strapped School District $139 million over the next five years – $100 million more than District officials had previously stated.

A District spokesperson released the revised figure hours after School Reform Commissioner Joseph Dworetzky directly challenged District staff’s previous public estimate -- $38 million over five years – during the SRC's open session Friday morning,

In the coming school year, those seats will cost $13 million, a steep price tag for a District still facing a 2013 budget shortfall of as much as $282 million, much of which will have to be borrowed.

Officials said the $139 million in projected expenses over the next five years could be offset by roughly $20 million in savings because Mastery Charter Schools agreed last year to relinquish 600 approved but unused seats for its Lenfest campus.

The costs of the new charter seats have been factored into the District’s projected shortfalls both for next year and over a five-year period, a District spokeswoman said Friday.

The SRC has yet to hold meetings for seven charters still up for renewal or modification this year.

For weeks, Commissioner Dworetzky has been contending that the District and SRC must meet their central goal of expanding the number of “high-performing seats” in city schools through a more cost-effective approach than expanding existing charters.

“I think the cost of these seats is really, really high,” Dworetzky said.

“These are … in my view, not well-justified expenditures.”

Friday morning, Dworetzky questioned Darden on the cumulative costs of the charter seats added to date.

After Darden responded with the $38 million figure, Dworetzky jumped in.

“The number I have is substantially greater,” he said.

Officials estimate that each new charter seat comes at a net cost of $7,000 per year to the District.

That figure represents the difference between the amount of the per-pupil charter payment the District must pass on to the charter and the amount of savings the District is able to realize by taking that seat off its books.

The $7,000 per seat, per year figure does not account for the so-called “stranded costs” that the District incurs as a result of the empty seats and underutilized buildings that the District must maintain even after losing students to charters.

The $7,000 per seat, per year figure also does not account for potential savings to the District from creating new charter seats. For example, the SRC has been negotiating with some charters to prioritize taking students from overcrowded District schools with the intent of limiting the District’s need to construct new facilities.

Here are the details on the additional seats over the next five years that the SRC has approved so far this spring:

Philadelphia Performing Arts 1,400 seats

First Philadelphia 1,150

Nueva Esperanza 710

Wissahickon 536

Boys' Latin 320

West Oak Lane 296

Franklin Towne High 250

New Foundations 211

Mastery Pickett 136

Franklin Towne Elementary 130

KIPP Philadelphia 106

Alliance for Progress 100

Southwest Leadership 56

KIPP West Philadelphia 15

Dworetzky has maintained that growing the District’s Renaissance Schools initiative, which includes both wholesale charter conversions and District-managed turnarounds, is a preferable strategy.

Officials estimate that creating a seat in a Renaissance charter costs the District $800-$1,000 per year.

On Friday, after the Notebook/Newsworks pressed for clarity on the cost, District officials released a spreadsheet detailing the year-by-year expansion plans and revealing the higher projected cost.

Despite the erroneous $38 million figure given publicly on Friday, the District’s Darden stressed that the SRC has been working from correct estimates of the financial impact of charter expansions throughout this year’s renewal and modification process.

Darden is off by $101 Million. He must have attended the Ackerman school of accounting. Did anyone other than Dworetzsky question the numbers? If not, what were the SRC members doing? Expanding charter seats is NOT a cost savings. Is the SRC only fiscally "responsible" when it comes to tearing apart School District of Philadelphia schools? For example, Performing Arts Charter is in South Philly. South Philly is saturated with schools. It also has two prominent performing arts schools (GAMP, CAPA) and therefore there is not a need for another. (There is also Kensington CAPA and Rush in the NE). As a taxpayer in a city which is continually upping taxes, I'd like an intelligent response.

Amazing. And this expense will only spiral as charter expansion acclerates. Meanwhile the state seems likely to further erode local control over charters, prohbititing the District from capping growth and perhaps removing the whole process of approval and removal from the District. What this will mean, among other things, is the District will be unable to realize any economies of scale that come with being able to make determinations about where new or expanded schools are needed. More lost savings.

The same people who insist that the District's financial straits require cutting instruction to the bone and driving District 1201 members into poverty, are apparently willing to spend millions of dollars they don't have on expanding charter schools. Then they tell us it is not about "ideology,"

I hope 1201 had the inspiration to write that any giveback would be contingent on complete and accurate public disclosure of PSD expenditures (especially in regard to charter expansion), and should this be lacking, that the PSD would be liable for this giveback.

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"Officials said the $139 million in projected expenses over the next five years could be offset by roughly $20 million in savings because Mastery Charter Schools agreed last year to relinquish 600 approved but unused seats for its Lenfest campus."

There is so much suspicious behavior here. Mastery last year relinquished "600 approved but unused seats for its Lenfest campus." Did they ever receive any money for these seats? Not paying for them is a $20 million savings! How much was already given to Mastery?

Once again we see why the charter schools do not want any transparency. There are things they and the SRC need to hide!

THERE IS NO SUSPICIOUS BEHAVIOR AT ALL. IT'S ALL IN THE OPEN FOR ANYBODY TO SEE BUT THERE'S NOTHING WE CAN DO ABOUT IT APPARENTLY, NOT WITH THE CROOKED POLS LIKE CORBETT PULLING THE STRINGS. WELL, THERE IS SOMETHING WE CAN DO ABOUT IT BUT IT WOULD REQUIRE REAL ACTION AND JERRY ET AL ARE RESISTANT TO THOSE MEASURES SO WE JUST WATCH THE S.D. BE DISMANTLED FOR THE CORPORATIONS' BENEFIT. TELL ME WHERE I'M WRONG !!!

When a student transfers to a charter, the District loses the per student $ for that student. Thus, per the article, it leaves the District with a shortfall of about $7000 per student in expenses from fixed costs such as building maintenance and possibly transportation. What was not calculated per the article, is the per student savings that might occur from not having to build or find new facilities for overcrowded schools that would experience relief from students transferring to charters. The estimates have to have a margin of error since it can't be predicted from which schools students would transfer to charters: transferring from schools that have a lower enrollment would cause the greatest deficit probably exceeding the $7000 per student estimate, and from schools that have a greater enrollment would cause less. Makes sense to me.

$100 million dollars is a really BIG error! How was Darden's cost estimate so much lower than the actual cost?

"In the coming school year, those seats will cost $13 million, a steep price tag for a District still facing a 2013 budget shortfall of as much as $282 million, much of which will have to be borrowed."

What makes up the $13 million of costs to the District? Capital expenses? Transportation expenses? What else???

"Officials said the $139 million in projected expenses over the next five years could be offset by roughly $20 million in savings because Mastery Charter Schools agreed last year to relinquish 600 approved but unused seats for its Lenfest campus."

This quotation doesn't make sense to me. Was Mastery being paid by the seat instead of the actual number of students? How is Mastery relinquishing unused seats?

$100 million dollars is a really BIG error! How was Darden's cost estimate so much lower than the actual cost?

Darden contended that the "error" was not a calculation error that has been the basis for budgeting/decision-making, but a mistake in the initial spreadsheet that the District provided to the Notebook/NewsWorks earlier this week and then a misstatement on his part before the SRC on Friday.

With re: to the initial spreadsheet, it took the District over two weeks to respond to my initial request for that information, due ostensibly to a careful effort to make sure the number was correct. After receiving the initial spreadsheet, which contained the $38m figure, I had a conversation with Darden in which I asked him directly about that number and he confirmed its accuracy.

What makes up the $13 million of costs to the District?

As I understand it, this figure is not so much a direct cost but an unrealized savings for things like staffing, administration, infrastructure, and capital expenses that still must be incurred to keep a school running even after it loses a few District students to charters. It also accounts for the entirety of the expense incurred by the DIstrict when charters get students from outside the District; eg, if a student from a parochial school enrolls in a city charter, the District still must pay the per pupil allotment to the charter even though the District does not get to realize any savings from having that student come off its books. If memory serves, something like 30% of charter students do not come from the District.

Was Mastery being paid by the seat instead of the actual number of students? How is Mastery relinquishing unused seats?

As I understand, Mastery's charter at Lenfest allows for a certain number of seats, 600 of which are currently not filled. I'm not sure why those seats are not currently filled. Hypothetically, though, Mastery could have chosen to enroll 600 more students there for each of the next 5 years in order to get to its cap. Had Mastery done so, the District would have incurred roughly $20 million in expenses over the next 5 years. By getting Mastery to agree to relinquish its right to those 600 seats, the District is not saving money its currently spending, but limiting its exposure to possible future expenses.

Thank you for the additional information. Here are a few more questions:

How much does it cost to run Darden's office? His office is dedicated to supporting charter schools. This should be calculated into the cost of expanding charters. Does the $7000 include the cost of transportation for charter school students (e.g. buses, transpass)? What about the cost of the "Renaissance" charter buildings? We know the some of the charters pay for the building maintenance staff, but what about the debt service on the buildings?

Also, while not apparently addressed at the SRC meeting, Mastery and KIPP, as well as other charters, require parents/guardians and students to sign a contract. (Mastery labels it a "pledge.") Has the SRC ever discussed how the "contract" is inequitable? Have they ever discussed allowing "contracts" in neighborhood, SDP schools? While magnet/special admit schools obviously pick their students, neighborhood schools accept anyone in a catchment BUT are not allowed to have a contract like Mastery and KIPP. Doesn't the "contract" negate the catchment? (e.g. if a parent/guardian/student will not sign the contract, or violates the contract, then they do not attend the school even if they live in the catchment; if Fitzsimons student wants to attend KIPP but won't sign the contract, are they eliminated)

Thank you for this. Page 7, on which parents agree to legal prosecution if they do not report their child "for the willful infliction of injury to another person or for any act of violence committed on school property" prior to acceptance to Mastery is quite threatening enough to make many parents decline to sign. This is a great way to eliminate kids who have had discipline problems in school. It says to parents, "Dime out your kid, who we then won't accept, or go to jail for lying to us." I wish we could do this at my school.

The other thing that surprised me was the depth of parental information. I am not aware of the SDP using info about which parent or parents a child lives with when considering school placement. Any school would be foolish not to take such factors into consideration if they could. Obviously children in foster care are at greater risk, as are children in other domestic situations. How does a public school--which I'm assuming Mastery purports to be at some level--get to pick and choose for these factors?

I can see parents anxious for school choice congratulating themselves on being the right kinds of parents with the right kinds of kids--the ones Mastery is culling through applications for, but Mastery's system is in no way a fair replacement for a public school.

I'd love to see the press my school would get for insisting that parents fill out paperwork like this.

Most charters require the disclosure similar to Mastery - at least high school charters. Not all have the "whatever it takes" pledge which can be used to "counsel out" a student even before he or she applies. Franklin Towne Charter, notorious for its $45 fee, won't give out an application until a parent attends an evening meeting. Boys Latin also requires a group evening meeting and then an individual day meeting with the parent and student before accepting an application. If this isn't an admission requirement, what is? The charters also require students to submit an IEP/504 so that can weed out students.

A savvy, informed parent would challenge fees, meetings, and IEP disclosure. A savvy parent would contact the Education Law Center or some other advocacy organization for assistance. Unfortunately, not all parents are as informed or willing to put in that much work. Some might have a hard time doing this possibly due to work schedules or other time conflicts.

You give Mastery more credit than it deserves regarding Harrity. ALL Mastery schools have the same contract.

I don't think many parents - including informed parents - will challenge what goes on for fear of the charter getting rid of their child. If they don't want their child in a neighborhood school, which is the alternative to the charter, they will follow the charter's rules.

I'd be interested what a school like Penn Alexander uses in order to confirm where students live. Because there are too many children for the school to accommodate, I wonder if Penn Alexander would go about making sure that a child lives in the catchment area instead of just using a catchment area address. Perhaps this is the reason for the information request at Harrity? My understanding is that Harrity has a waiting list. Also, I know what the school building looks like and there's nowhere to expand the building because the playground is already fairly small. Perhaps the handbook is a form of screening, perhaps not. I think on would have to know how it is actually used in order to definitively say for sure whether Mastery is counseling out students.

From what I understand, Penn Alexander did a more rigorous residence review last summer and some students were asked to leave for not really living in the catchment. There were instances of families renting apartments in the catchment and subletting to college students but keeping the utility bills in their names. How they exactly went about doing a more stringent check is one of the school's many secrets.

Pretty smart idea to rent out a place for the address so that your child can attend one of the better schools in the District. By the way, an excellent idea! But not a new idea. Parents who want their children to attend school in Lower Merion, Abington, Cheltenham, and reside in Philadelphia, have been doing this for years.

The District does have a Code of Student Conduct. Seehttp://www.phila.k12.pa.us/offices/administration/policies/118.html. However, the District doesn't have the same leverage as a charter like KIPP to enforce its code of conduct. All the District has are alternative schools/discipline schools. KIPP can always dump students back into District schools or neighborhood charter schools.

What Philly school can require a parent/guardian/student to sign the code of conduct? Yes, students who have a long history of "violations" may be asked to go to an alternative school but the parent/guardian has to sign off on it. It is much more complicated for students with an IEP. Discipline schools are for students who have have what is considered more severe violations (injure someone in a fight, drugs, etc.) Students who get into fights are not removed from SDP schools. If they repeatedly fight, their family is asked if they can be moved to another SDP school. As you wrote, KIPP, Mastery, Aspira, etc. can "always dump students back into District schools."

What you say is so true, and by 'repeatedly fight', that could mean 8-10 times, and then, if a principal tries to move the child with severe behavior problems out, he/she has to accept someone else's maladjusted child in return. Those students rarely get moved to the disciplinary schools, and they move on to new pastures, to sabotage their new classmates' learning.

If the District was really serious about improving student achievement, they'd provide funding for each school to set up a system within a system, one that would educate these children, in separate classrooms, by highly qualified teachers- A system that would have the flexibility to integrate these children back into the regular classroom when, and if, their behavior merited it. That way, the rest of the children would not have their education stolen from them.

If I was a Doctoral candidate, I think that I'd do a dissertation on the effects of setting up such a system on student achievement. Any takers?

The district would be better served to expand the current disciplinary schools. Class sizes in AD-4 are 30+ for much of the year and in high schools I saw them in the mid-40s (justified by sparse attendance of some students). Keep in mind, those teachers do not get NTAs or any extra help.

The reason it is so hard to place students in these schools is because of severe overcrowding (200% capacity in some schools).

Another reason is that once students get put in Alt Ed, their former principals refuse to take them back at any point. There was a pretty big kerfuffle this year between regional superintendents when the alternative programs tried to reinstate students who had been in Alt Ed for years. Nobody would accept these students back.

Supposedly, there were only 15 or so expulsion hearings this past school year. Schools in the alternative region regularly received that many new students in a week, so I am not sure how they were getting there.

Regarding your point that "If the District was really serious about improving student achievement, they'd provide funding for each school to set up a system within a system, one that would educate these children, in separate classrooms, by highly qualified teachers," the District already does this. They have separate classrooms for children with emotional and behavioral disorders. However, the District does not have the authority to force all children with behavior problems into these classrooms. For children with an IEP, it is the parents who have the choice as to the placement of the child. If the parent consent to a separate classroom, then the child can be in a separate classroom. However, the District doesn't have the authority to force children with behavior problems into separate classrooms.

The best case scenario is that these classrooms exist. I got out of special ed, I am sorry to say, at just the right time, and even back then it was really hard--no, it was impossible-- to get the right services for kids. I am relieved every day to be working with "regular ed." We are so dishonest about working with kids who we can't get things right for, and the assumption that "there are classrooms for children with emotional and behavioral disorders" does not reflect what actually happens. These classrooms do not exist within the SDP, and they do not exist in charter schools. This is the ugly truth, the hot potato. Who will take these kids? The inadequacy of our placements for special ed kids is monumental. We do even less for our behaviorally troubled kids. But this is not just true of SDP. Charter schools won't touch these kids. Who would as long as they are simply a budget item? Most of the kids who fall into these groups need so much more intervention K-3 than we've ever owned up to. Sadly, this is not likely to happen any time soon.

Barely any schools have full-time emotional support. A few have smallish classes of ED students that travel through regular classes together.

There are entire regions of the city with nary a full-time ES class to be found.

There are also issues with diagnosing ED. Some schools never diagnose it, because once you do, behavior problems from that kid are protected by the IEP and you can't suspend/expel as easily. Some schools overdiagnose it to get more help. There is little consistency with what we call "Emotional Disturbance."

I want to clarify what I wrote. I don't think students should be "kicked out" for every infraction - I don't think "zero tolerance" is effective nor equitable. There should be enough supports in a school to provide counseling (peer, individual, etc.) to help everyone involved work through whatever is causing the problems. I've had, for example, students caught with marijuana who, because of zero tolerance, were kicked out. They were not all so-called "problem" students; counseling would have been a much better option. I've also had students who were caught with a knife in their bag and were kicked out. They never used the knife and had a variety of reasons for having it in their bag. As a parent and teacher, I warn my children / students about carrying a scissors, nail clippers, pocket knife, etc. for fear they will fall under "zero tolerance."

I know there is a lot of talk about "restorative practice" but it is not district wide. There should also be a lot more in school counseling supports with local behavioral health organizations that can provide supports for not only students/staff but also families. That takes money - maybe the "Great School Partnership" will start funding what we need!

The partnership is headquartered on a one-way street, and it's going the wrong way. If the SRC screwed up and awarded ONE HUNDRED MILLION DOLLARS more in charter expansions,they need to correct their error and revoke the unintended expansions. PhillyPT, the SRC will wind up cutting from the only pot left - the schools directly under their sordid control. Their 'mistake' is going to wind up causing regular schools to lose even more funding - meaning more of the people who are there to work with kids before they do something stupid and wind up wearing a scarlet mark on their "permanent record". The state is confused - they've created a gold rush in charter creation while exempting their proprietors of accountability. The state legislature is failing to meet its state constitutional mandate to put the needs of the Commonwealth above all else. Who engineered this state takeover - Stalin?

Here's an issue I have with the $139 million in cost to the SDP. I thought that the current push of school reform focused on market incentives and making school districts act like businesses. How is the SDP acting like a business if approving charter school seats is going to cost it $139 million?

This is all corruption all the time. For the first time in history, the corporations see education as a way to make money so they're doing it hand over fist and the crooked pols like Corbett are pulling the strings in PA. Consequently, the rules don't apply to Charters that do for the real schools. As usual, there;s no transparency and no accountability. The brazenness though of doing all this right in our face is stunning. What are we going to do about this Jerry Jordan?

That is the question -- this is not a free and transparent market. It's the SRC voting to funnel funds to charters over its own district schools. In spite of the fact that many lag BEHIND district schools, at least on some indicators. KIPP North "lost" 27% of its students in a year? Really? This is what we want to invest in? There is no other way that these votes on the so-called "exception schools" can be interpreted.

Wait, Dworetzky has balls all of a sudden? Did he just wake up? Please, this posturing is absurd.
And Lorene Cary, who cares so much about the children - she doesn't have a problem with this?
We live in Crazytown.

I agree about Cary too. She has been silent but always looks "concerned." A female version of Jerry Jordan. By the way, Dworsky set up Darden for a major fall, not that Darden has far to go to reach the bottom. Nobody deserves it more than Darden too.

If Lorene Cary truly believes that all of our children are "exquisite," I'd think she'd be expressing strong denunciations of Mastery Charter's application. Why should these "exquisite" children need their parents to swear to their good behavior?

Benjamin, the 30% of students from outside the district number is about 10 years old. What has also not been calculated are the following:

a. accumulated savings for close to 10 years of charter reimbursement at rates of 30% and 42%
b. The revenue generated by each student from state funds
c. The savings of hundreds of students educated by charters of the enrollment cap
d. Most importantly, the refusal or inability of the district to reorganize based upon reduction in enrollment due to charter schools and population shifts. This has been the most costly mistake.

I remember that when Ramos was School Board Chair during the Hornbeck era and the beginning of charters in Philly -- he voiced alarm about how charters didn't make fiscal sense for the public system. He noted that they harm the public schools' bottom line by taking away revenue without subsidizing unmet costs of still having to maintain public schools. See a May 2, 2000 article in the Inquirer by Dale Mezzacappa reporting on a study done by pro-charter groups (Annie Casey Fdn., Foundations, Inc., and Urban Affairs Coalition) decrying the "strained" relationship between Philadelphia public schools and charters.

Ramos makes the point in that article that charters cost the district money without serving actual needs of the district (eg., overcrowded schools). Now Ramos is on the other side.

The article is so interesting as a piece of history -- and the warped logic of the pro-charter folks. The code language was "strained relationship," blaming the district for not embracing a strategy that actually undermines it. Ramos was skeptical - though not necessarily totally against charters, he seemed to recognize the fiscal implications.

There were 25 charters then -- and the "study" (I put that in quotes because its authors all had a vested interest in promoting charters) complained that charters were at a disadvantage because they did not have enough money to acquire and renovate facilities, banks weren't willing to lend them money, etc. Now we are giving Charter operators buildings for free, The Reinvestment Fund (Nowak's former organization) set up a charter loan fund, and there's the Philadelphia Schools Partnership -- an organization bankrolled by wealthy suburban pro-voucher folks and the William Penn Foundation (thanks to Nowak, again) with loads of money to shift the balance of power inthat "strained relationship" they still are harping on.

Oh, Pedro Ramos, what has happened to you?

Let's hope Dworetzky keeps paying attention. And that Darden gets his resume together!! But the charter train has long ago left the station.

Thank you for the historical review of Nowak and Ramos. Both are dangerous men who appear to think they are "doing good" while making agenda to advanced their own agenda. Both are extremely pro-charter. In the spring, Ramos was at a public meeting where he said he wants to get rid of neighborhood high schools. He praises Aspira and Nueva Esperanza. Nowak's unending support of charters at the expense of public schools is obvious.

Darden - still amazed he has a job since he is an Ackerman "give me a title" leftover.

While charters are obviously entrenched in Philadelphia, including many "poor performing" charters, I'm waiting for them to reach the suburbs like Nowak's home in Lower Merion. As more "cyber" charters threaten the budgets in suburban districts, maybe, just maybe, people in power will question not only the fiscal efficacy of charters but the academic equity.

Is anybody paying attention? Darden has a history of fiscal mismanagement and worse:

"To recap: the private investment firm of which (Thomas) Darden was a co-founder and managing director, sunk Rhode Island based BlueSky Brands, of which Darden was a director, committing violations of labor law in the Virginias and mis-managing (if not looting) the pensions of workers in Rhode Island. Darden then headed off to the Broad Academy and Philadelphia Public Schools, where he was a key part of the corrupt and discredited Ackerman administration's strategy of parceling off the district's schools to private operators. And now he's the frontrunner for PPSD superintendent? In the middle of a rolling pension crisis?

The cherry on top of all this is that the Rhode Island businesses Darden bankrupted were up and running in no time with proper management:"

The briefest of internet searches reveals that Mr. Dworetzky's professional success has been achieved by guiding clients through bankruptcy, making him an imminently qualified SRC member. When he could have easily bowed out, Mr. Dworetzky decided to maintain his volunteer position on an unpopular commission at considerable personal cost through time and airfare. He is doing his homework, asking hard questions, expecting accurate answers, and challenging misinformation publicly.
How would the SRC be better serving our students if his other four colleagues showed the same level of courage and concern for the public good as he?

Dworetzky makes one good move and now he is our hero? Boy, some of you are really cheap dates. Mr. Dworetzky served during the Ackerman reign and never stood up to her. Almost all of the SRC votes are unanimous'; Dworetzky is just as much a charter supporter as anyone else.

Is this a new direction for him? One can hope, but i'm not holding my breath.

A few of the things he has said have indicated he has gone rogue. Maybe he took a long hard look at the mess in LA caused by the exact thing Philly is attempting, breathed some fresh air, and had a change of heart?

When was Dworetsky appointed, and who appointed him, the Mayor, or the Governor? His term limit is determined by that. I think that the Governor's appointments get an additional year. It'd be just our luck if, now that he's 'seen the light', he gets replaced by another Corbett clown/clone.

Delaware Valley Charter High School also has admission requirements similar to Mastery - parents and students must sign a contract but, in addition, students have to write an essay, have two letters of recommendation (from English and math teacher), must submit PSSA (or benchmark?) scores, etc. Incoming 9th graders also have to attend a 3 day MANDATORY orientation. Parent have to attend an orientation. See for yourself -

The SRC has to investigate the admission requirements at charter schools! The admission requirements make them special admit schools - NOT neighborhood school alternatives. This is NOT a few charter high schools - it is pervasive! Doesn't this violate the charter school law????

Not the kind of schools that I attended, but I did learn learn to teach people about BAD_POOL_CALLER nonetheless, so no skin of my back, no for those that are to come after me, I'll hope that they can and will attend to the best schools.

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